talon57@well.com said:
>From: "J. R. Molloy" <jr@shasta.com>
>> So, the answer is: Everyone needs to own their own home. Then
>> they'll have a stake in the welfare of their communities. Big deal...
>> any Real Estate Principles teacher could have told us that. Why do
>> you think State governments provide low interest loans (VA, graduated
>> mortgage, Cal-Vet, FHA, RECD, etc.) to potential home buyers? That's
>> right, to encourage home ownership.
> Its a great deal more complex than that, you've oversimplified what he
> is saying. As he points out bureaucracy makes it almost impossible to
> own your own home/land/company in many countries much less use it as
> an economic asset.
I'm at least three quarters through the book. One of de Soto's major
points is that the poor in third world countries *do* own their own homes,
in the same way that occurred in many places in North America and the
nascent US through much of the 19th century. They and their neighbors
agree on who owns what property, and will defend the ownership against
people with government-backed claims. But until their ownership becomes
registerd in a standard way (as we take for granted in the US today) you
can't turn it into capital to invest in other things. de Soto details the
political struggles in the US that led to standardising forms for ownership
and registration of property. We've mostly forgotten how that transition
happened, so we haven't been able to help the third world get through the
process.
de Soto gives detailed examples of countries like Peru and Egypt where the
government realized that legitimizing the poor's ownership of property was
important, and created bureaucracies to push it. There's a process in
place, and when de Soto's group followed it, to find out how it worked,
they discovered that it could take more than a year of full time work to
talk to all the different departments that had to sign off on it. (Some
great charts on this subject.) As a result, the poor continue to live in
and defend their "illegal" property, but they can't turn it into money.
I think it's Egypt for which de Soto says that the poor own/control
property worth something like one hundred times the total value of all
foreign investment in that country over the last 100 years. But they can't
get a mortgage, so it's "dead" capital.
Chris
---
Chris Hibbert It is easy to turn an aquarium into fish soup, but
hibbert@netcom.com not so easy to turn fish soup back into an aquarium.
-- Lech Walesa on reverting to a market economy.
http://discuss.foresight.org/~hibbert/home.html
(this email address currently broken. try me at hibbertc@pacbell.net)
This archive was generated by hypermail 2b30 : Sat May 11 2002 - 17:44:15 MDT